Lenovo Meets Apple

As the World Economic Forum takes place in Davos, Swizerland; naturally technology and its continued impact on world economies is among the conversation. While Apple is seen as the heir-apparent global ruler of consumer products in the tablet and Smartphone arena, a technology player in China is pushing back. The coveted Chinese market just may align with the brand Lenovo and shun Apple in a market worth billions over the next several years.

Lenovo, maker of Thinkpad laptops and the biggest maker of personal computers in the region, is diversifying in a quest to boost revenue and brand visibility. The company started selling the LePhone in China’s domestic market in May, and plans to launch the LePad -both positioned as answers to Apple's iPhone and iPad, respectively - by the end of this quarter, according to Lenovo Chairman Chuanzhi Liu. During an interview at the World Economic Forum he stated, "We have an extreme focus on the innovation of LePad and LePhone because these products will dominate the future market."

Currently Apple’s iPhone is the bestselling Smartphone in China, accounting for 39% of revenue last fiscal year. The iPad, introduced in April, accounted for 17% of revenue last quarter. Lenovo received 98% of its 2009 sales from personal computers, and less than 1% from mobile phones. “History has proved we are good at catching up with the market’s leaders,” Liu said. “Though Apple is winning a significant share in the Chinese market, it has not gained a clearly leading position yet. Our advantage is we know this market better, " states Liu.

A tech entrepreneur based in the United States who has followed Lenovo's movements for quite some time tends to agree with Liu. "I think that Lenovo's mobile strategy will, in the long term, definitely make them a player in the mobile market in China. The LePhone had a decent launch, although there have been some issues," explained Mark Nyon. "The LePhone looks like a solid product that has gotten good reviews; it's currently only available in China, so I can't completely evaluate it for myself. The LePad also looks promising, although it is being launched into a crowded space. The hybrid phone/PC should separate it from the pack; Motorola is trying the same experiment with the Altrix, which was a big hit at the CES (Consumer Electronics Show)."

Lenovo recently said that it agreed to invest $175 million to form a venture with NEC Corp and expand in the Japanese PC market. What remains to be seen is how Lenovo's market growth in China may affect the company's possible expanded distribution into even more countries in the years to come should it become more and more successful in its home territory.